An evaluation of policies to reduce overconsumption of sugar-sweetened beverages

In the wake of the recent obesity epidemic, policymakers are grappling with ways to reduce calorie consumption. One of the biggest culprits of high-calorie intake is Sugar-Sweetened Beverages (SSBs). SSBs cost the society in two ways: directly through healthcare costs of diseases caused by SSBs such as metabolic syndrome and Type 2 Diabetes; and indirectly through a reduction in productivity levels due to absenteeism caused by these diseases. At present, the price of SSBs does not reflect this cost on society and thus the consumption of SSBs is at a socially nonoptimal level. This paper evaluates the economic (own-price, cross-price and income elasticity) and non-economic factors (socioeconomic, psychological and cultural) that influence SSB consumption and the current policies in place to reduce SSB consumption. Finally, it proposes a novel study to quantitatively compare two common taxation policies to reduce SSB consumption: sugar tax and SSB tax